3-THE PUBLIC "OVER-INDEBTED" COUNTRIES ARE MAINLY IN THE RICHEST ONES, ACCOUNTING FOR ONLY 13.9% OF WORLD POPULATION - page 68

4- EUROPEAN UNION, EURO AREA AND PUBLIC DEBT - page 71

5- JAPAN -page 73

6 - POLICY REGARDING PUBLIC INDEBTEDNESS-page 74

VI -OTHER ECONOMIC OPTIONS - page 75

1 - THE RISK OF PROTECTIONISM - page 75

2 - ECONOMIC CHALLENGES- page 76

VII - PLANETARY SOCIAL DISPARTIES - page 80

1-DEFINITION-page 80

2-CALCULATION- page-80

3-GINI INDEX APPLIED TO THE PLANET-page 81

4-ANALYSIS-page 86

VIII-THE REASONS WHY THE EUROPEAN UNION IS NOT A GREAT POWER - Page 93

1-EU AND NATO-page 93

2-CREATION AND TREATIES - EXPANSION AND INTEGRATION, Page 96

3-THE PROBLEM OF THE APPLICATION OF THE CHARTER OF FUNDAMENTAL RIGHTS-page 98

4-THE CONSTRAINTS OF DECISION MAKING-page 100

5 - INSTITUTIONS page 101

6-THE POLITICAL ORIENTATION OF THE EUROPEAN UNION-page 108

7-INTERNATIONAL POLITICS - page 112

8-THE CASE OF THE EUROPEAN PARLIAMENT ELECTIONS - page 113

9- THE DISPARITIES OF THE MEDIAN INCOME OF HOUSEHOLDS IN THE COUNTRIES OF THE EUROPEAN UNION - page 114

10-THE NEW MEMBERS OF THE EUROPEAN UNION -page 115

11-THE LIMITS OF THE EUROPEAN UNION page 116

12-A PARTICULAR EXAMPLE OF THE RIGHTIST ROOTING OF THE EUROPEAN UNION-page 119

A-The Prague Declaration of June 3, 2008 - page 120

B-The dangerous consequences of the Declaration of Prague and of the related Declaration of the European Parliament-page 121

k-DECLARATION - page 135

IX - GENERAL CONCLUSION -page 138

APPENDICES

1-DATA OF THE FIRST 60 COUNTRIES WITH GDP HIGHER THAN 100 BILLIONS USD AND THE REST OF THE WORLD - Pages 145 and 146

2-DATA ON THE INDEBTED COUNTRIES OF THE EUROPEAN UNION page 147

3-DATA OF THE EURO AREA COUNTRIES -page 148

4-GENERAL DATA OF THE EUROPEAN UNION -page 149

V-PUBLIC DEBT

1 - KEY DATA ON PUBLIC DEBT

Public debt allows among others, a State to cover its accumulated budget deficits. This debt can be virtuous if its applications increase ultimately the revenues or decrease the expenditures of the state at the point of at least providing new resources sufficient for its repayment. Unfortunately in a capitalist economy, the State may only take incentive steps to encourage such applications without guarantee of result since the State is not or not anymore a direct actor in the economy.

The public debt is too often utilized to cover deficits due to the decline in State revenues resulting from an economic downturn or from insufficient tax revenues in line with the capitalist theory, which advocates the minimization of State intervention.

In this case, these deficits and consecutive debt, fall down in a vicious circle due to ideological choices and which are:

The loss of influence and action of the State in the industrial and commercial fields,

The assimilation of welfare to economic growth despite they are not necessarily related and may even diverge.

The systematic rush to production is sometimes an incentive to technological progress, but it also generates a need of consumption for itself far from a real welfare and often without respect for the planet that is also necessary for welfare.

The long lasting goods and services can provide a bigger welfare than that based on precarious goods and services enabling

a reduction of production as well as

the correlated reduction of the pollution and

of the necessary quantity of work required.

The remaining necessary work could be shared in order to offer everyone an income that would give even reduced, access to a greater welfare because of the new type of goods and services and also in order to offer more available time for personal development and for a better quality of life.

The reduction of working time to 35 hours in France and the "initial" will to maintain the retirement age of 60, are examples of fair sharing of remaining quantity of work. The volume of production involves an adaption of means to a new conception, which is based on the real needs instead of those guided by the sole profit.

The rush for production, concern mainly fourteen countries out of 193, which absorb 75% of the production of the planetand represent only 38% of the world population.

2-THE RISK OF OVER-INDEBTEDNESS CONCERNS ESSENTIALLY THE RICHEST

COUNTRIES

Only States assumed to be rich, are currently eligible for loans enabling them to cover their deficits; most other countries do not have access to such facilities. China is the only major power to have had "by choice" a very limited use of public debt.

The thirteen countries with highest GDP,excluding India because of its poverty and China because of its limited use of debt, cumulate together a public debt of 38 billion USD i.e. 74.5% of the world public debt. These thirteen countries represent only 1 324 million inhabitants i.e. only "19%" of the world population.

The European Union, which represents only 7.2% of the world population has accumulated 29.5% of the public debts of the planet.

3-PUBLIC OVER-INDEBTEDNESS CONCERNS ONLY 13.9% OF WORLD

POPULATION LIVING ESENTIALLY IN THE RICHEST COUNTRIES

Considering that a country with a public debt in excess of 60% of its GDP is over-indebted, we may say that only 18 countries out of which only two poor ones (Egypt and Morocco) are over-indebted out of the 193 countries recognized by the UN.

These 18 countries, account for 75.7% of public debt world but represent only 13.9% of the population worldwide. This over-indebtedness has been made possible by the wealth of most of these countries, which give or gave them, a very large access to credit lines since their averaged GDP per capita is 39 978 USD. These 18 countries produced 51.2% of global GDP and have a broad access to debt that have generated their lack of budget discipline.

GLOBAL FIGURES OF THE 18 OVER-INDEBTED COUNTRIES

$bn GDP

DEBT% GDP

GDP/POPULATION

DEBT bn USD

Population

18 countries

38 099

99.40%

39 978

37 883

978

WORLD

74 460

71,60%

10 604

50 017

7 022

% OF WORLD

51.2

75.7

13.9

EUROPEAN UNION

17 960

74,60%

35 635

13 403

504

All these countries are not in the same critical situation and three categories of over-indebtedness may be distinguished.

A-FROM 60% TO 80% OF GDP - TEMPORARILY TOLERABLE

COUNTRY

$bn GDP

% GDP

GDP/POPUL

DEBT BILLION $

population

GINI

MOROCCO

102

65

3 188

66

32

41

USA

15 060

69

47 962

10 391

314

45

SPAIN

1 537

68

32 702

1 045

47

32

AUSTRIA

425

72

53 125

306

8

26

ISRAEL

245

74

30 625

181

8

39

TOTAL

17369

68

42 466

11 989

409

Spain is not too overloaded with debt, but this has not protected it against a major banking crisis that a severe state control could have moderated. Four of these five countries are rich. The averaged GDP per capita average of these countries amounts to 42 466 USD.

These countries represent 24% of world public debt, 23.3% of world GDP and 5.8% of world population; they also represent 31.6% of the public debt of over-indebted countries and 41.8% of their population.

B-FROM 80% TO 100% OF GDP - DIFFICULT SITUATION

COUNTRY

$ bn GDP

% GDP

GDP/POPUL

DEBT BILLION $

population

GINI

UK

2 481

80

39 380

1 985

63

34

GERMANY

3 629

82

44 802

2 975

81

27

HUNGARY

148

83

14 800

123

10

25

CANADA

1 759

84

51 735

1 477

34

32

France

2 808

86

41 910

2 415

67

33

EGYPT

232

86

2 761

200

84

34

TOTAL

11 057

83

32 616

9 175

339

These countries represent 18.3% of the world public debt, 14.8% of world GDP and 4.8% of the world population, they also represent 24.2% of the public debt of over-indebted countries and 34.7% of their population.

Four of these six countries are rich. The averaged GDP per capita of the six countries amounts to 32 616 USD.

C-100% OF GDP AND OVER - PRECARIOUS COUNTRIES

COUNTRY

$ bnGDP

% GDP

GDP/POPUL

DEBT BILLION $

population

GINI

Taxes /GDP

BELGIUM

529

100

52 900

529

10

28

47.9%

Portugal

242

103

22 000

249

11

39

44.9%

IRELAND

222

107

44 400

238

5

34

34.4%

SINGAPORE

267

118

53 400

315

5

47

14.8%

ITALY

2 246

120

36 820

2 695

61

32

40.9%

GREECE

312

165

28 364

515

11

33

39.9%

JAPAN

5 855

208

46 102

12 178

127

38

33.9%

TOTAL

9673

172.8

42 056

16 719

230

These seven countries are particularly rich yet with an averaged GDP per capita of 42,056 USD and they hold 19% of the world public debt, they produce 13% of world GDP and represent only 3.2% of the world population; they also represent more than 44.1% of the public debt of over-indebted countries and 23.5% of their population.

Japan and Singapore suffer from the same problem, which combines both a levy rate insufficient to provide the State with the resources it needs and a particularly unfair distribution of income, as a result 16% of the Japanese population lives below the poverty line.

4-EUROPEAN UNION, EURO AREA AND PUBLIC INDEBTEDNESS

INDEBTED

COUNTRIES

$bnGDP

DEBT% GDP

GDP/

population

USD bn DEBT

Debt/

population

population

GINI

BELGIUM

529

100

52 900

529

52 900

10

28

Portugal

242

103

22 000

249

22 636

11

39

IRELAND

222

107

44 400

238

44 400

5

34

ITALY

2 246

120

36 820

2 695

44 180

61

32

GREECE

312

165

28 364

515

46 818

11

33

GERMANY

3 629

82

44 802

2 975

36 728

81

27

France

2 808

86

41 910

2 415

36 044

67

33

SPAIN

1 537

68

32 702

1 045

23 222

47

32

AUSTRIA

425

72

53 125

306

38 250

8

26

In EURO AREA

11 950

94.5

39 701

11 295

37 525

301

REST OF EURO AREA

1 399

32.6

43 719

456

14 250

32

EURO AREA

13 349

88

40 087

11 751

35 288

333

% EURO AREA

89.5

96.1

90.4

% European Union

66.5

84.2

59.7

UK

2 481

80

39 380

1 985

31 507

63

34

HUNGARY

148

83

14 800

123

12 300

10

25

INDEBTED COUNTRIES

14579

88.5

39 463

13075

374

% ofEuropean Union

82.2

97.6

74.2

% of world

19.6

26

5.3

EUROPEAN UNION

17 960

74,60%

35 635

13 403

26 594

504

WORLD

74 460

71,60%

10 604

50 017

7 123

7 022

Thirteen of the twenty seven countries of the European Union are over-indebtedand represent 74.2% of the EU's population and 97.6% of the EU's public debt.

More broadly the European Union includes 26.8% of the public debts of the world while its population represents only 7.1% of it.

The Euro area is particularly affected by this phenomenon of public over-indebtedness. The seventeen Euro area countries include nine over-indebted countries which alone account for 96.1% of public debt of the euro area and 84.2% of the public debt of the European Union.

These nine countries account for 90% of the population of the Euro area and 59.7% of the population of the European Union.

THE FOUR LARGEST PUBLIC DEBT OF GENERATORS OF THE EURO AREA:

INDEBTED

COUNTRIES

GDP

DEBT

% GDP

GDP/

POPUL

DEBT

BILLION $

Debt/

population

population

GINI

ITALY

2 246

120

36 820

2 695

44 180

61

32

GERMANY

3 629

82

44 802

2 975

36 728

81

27

France

2 808

86

41 910

2 415

36 044

67

33

SPAIN

1 537

68

32 702

1 045

23 222

47

32

TOTAL

10 220

89.3

39 922

9 130

35 664

256

EURO AREA

13 349

88

40 087

11 751

35 288

333

The four main over-indebted countries of the Euro area represent 76.9% of its population, 76.6% of their combined GDP and 77.7% of the Euro area's public debt.

Among these four countries, Italy is the most indebted countries in proportion to its GDP; its debt represents 2,246 billion USD while the total public debt of the other four over-indebted countries of the Euro area amounts to USD 1,305 billion: Belgium, Portugal, Ireland and Greece.

5- JAPAN

Limits of protectionism, and inadequate government action

Japan is the third largest economy by the size of its GDP after the United States and China and the fourth largest exporter after China, USA and Germany. Japan has also the highest public debt of the world: USD 12,178 billion in 2011. This debt represents 208% of its GDP and has become a significant handicap.

Japan is not a great global power since this country has abandoned by its constitution (Article 19) to use military deterrent. Governmental actions of Japan are now limited by its huge public debt.

The Japanese government has taken expensive steps initiatives ultimately not effective to revive its economy. These actions have increased the high public debt already at a record level. Government initiatives were vain because of the spurt of the crisis in 2011 during which Japan suffered the violent earthquake in March 2011 that caused the devastating tsunami and the disaster of Fukushima.

Already in 1997 Japan's public debt had reached the size of the country's GDP and this situation steadily deteriorated.

The important aging of the population may also aggravate the country situation. 22.9% of the population is over 65 years old versus 17.3% in Europe and 16.8% in France. The median age in Japan is 44.8 years as compared to 39.9 years in France.

Japan's economy depends on the demand of its two main partners that are China (19.4% of exports) and the United States (15.7%). Debt of the country may be reduced by its potential tax resources subject to the willingness of the government to increase the levy rate. The levy rate of Japan, accounts for only 34% of its GDP, while for example the averaged levy rate of the main five countries of the European Union is 43.9% (Germany, France, UK, Italy, Spain).

6 - ATTITUDE REGARDING THE PUBLIC DEBT

The very high public debt of some countries of the European Union, Singapore and Japan relates thus mostly to rich countries on the basis of their GDP per capita compared to the rest of the world and its causes could be:

1. The generous credit lines granted to those countries and which spurred them to over-indebtedness due to mismanagement, with long term consequences,

2. The inadequacy of the levy rate whose consequences are often unfair for most of the citizens,

3. The state's inability to adapt resources to applications preferably to the contrary

The right-wing governments are reluctant to increase the resources of the State on an equitable basis and to take fair steps to re-allocate revenues in a way favorable to the economic activity. They appear to be in poor position to manage crises since their privileged steady reduction of public expenses may cause a decline of economic activity and social unrest.

4. The inability of corporations to adapt to economic context and their preference to maintain the same production process by reducing labor costs through layoffs or relocations,

This attitude lowers the tax revenues and increases the social costs for the state.

5. The vain expectation of a future growth that does not eventually happen in spite of incentives which might increase the budget deficit (e.g. Japan).

6. The austerity steps imposed to most of citizens that may induce an economic slowdown and a fall in tax revenues, which may be in excess of the savings initially expected from this steps.